Goods and Services Tax (GST) was implemented in July 2017. Since then the government is trying to make changes in the GST law to simplify procedures and provide ease to the business based on the recommendations.
Some of the recommendations made by the GST panel to Finance Secretary are mentioned as under:
- Reverse Charge Mechanism should be abolished.
- E-way bills should be stalled till 2019 and efforts may be made to bring some alternate method to replace it.
- Inter-state transactions should be allowed in Composition Scheme.
- 1% tax on Composition for traders, manufacturers and restaurants.
- Refund process should be automated.
- In place of all types of returns, there should be one consolidated return.
- Return process should be simplified and rationalized.
- The input tax credit (ITC) should be released within the same month. Matching and adjustment may be done later.
- Form 3B should be continued at least for one year.
- The return should be filed quarterly but tax may be paid monthly.
- Doing away with Harmonized System of Nomenclature (HSN) code in the invoice for easier return filling.
- Classifications of items should be such that the raw materials and finished products are in the same slab. This would make refunds later.
- Exempted or Nil rated goods should not be counted in aggregate turnover.
- All job work should be taxed at 5%.
- The service provider should also be allowed to take composition scheme.
- Allow revision in returns.
- The panel recommends the formation of a National Advance Ruling Authority.
- Search/raid should be conducted only if the authority has credible evidence against a person. Raid should be conducted only with orders of the commissioner.
- Scrutiny of returns should be 0.5 to 1% only.
- Registration of people even after July should be granted with retrospective effect from July 1 this year.